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A P U B L I C AT I O N O F T H E C O M M U N I T Y D E V E LO P M E N T D E P A R T M E N T O F T H E F E D E R A L R E S E R V E B A N K O F S A N F R A N C I S C O
www.frbsf.org/community
VOLUME EIGHTEEN NUMBER 2
OCTOBER 2006
Special Issue: Immigrant Communities
Crossing Borders, Creating Communities
Community Profiles
Immigration Trends and their Implications
for Community Development
Arizona
Financial Access for Immigrants
Los Angeles
The Challenges and Opportunities
Facing U.S. Depository Institutions
Community Development in
Dynamic Neighborhoods
Synchronizing Services and Strategies
with Immigrant Communities
Chicanos Por La Causa
Asian Pacific Islander Small Business Program
California’s Central Valley
Fresno Center for New Americans
Utah
Comunidades Unidas
CI Notebook
This publication is produced by the Community
Development Department of the Federal Reserve
Bank of San Francisco. The magazine serves as
a forum to discuss issues relevant to community development in the Federal Reserve’s 12th
District, and to highlight innovative programs and
ideas that have the potential to improve the communities in which we work.
Community Development Department
Federal Reserve Bank of San Francisco
101 Market Street, Mail Stop 640
San Francisco, CA 94105
www.frbsf.org
(415) 974-2765 / fax: (415)393-1920
Joy Hoffmann
Group Vice President
Public Information and Community Development
joy.k.hoffmann@sf.frb.org
Jack Richards
Director, Community Development
jack.richards@sf.frb.org
Scott Turner
District Manager
scott.turner@sf.frb.org
Lauren Mercado-Briosos
Administrative Analyst
lauren.mercado-briosos@sf.frb.org
RESEARCH STAFF
Naomi Cytron
Research Associate
naomi.cytron@sf.frb.org
David Erickson
Senior Research Associate
david.erickson@sf.frb.org
John Olson
Director
Center for Community Development Investments
john.olson@sf.frb.org
by Naomi Cytron
Editor
T
he immigration reform debate that has been swirling through Washington’s
political corridors is enormously complicated. At issue are concerns over
national security and the effects of competition in U.S. labor markets, as
well as the costs that immigrants may impose on government budgets.
While answers to these questions are ardently disputed by politicians and academics
alike, there is no doubt that immigration has always been a significant driver of U.S.
population growth and change. And over the past decade, the foreign-born population
has not only grown but has dispersed from traditional “immigrant gateways” to cities,
suburbs, and rural areas all across America.
The resultant increase in diversity has expanded the spectrum of foods found in local
markets and ethnic celebrations seen in the streets, and has enriched the cultural
landscape of our nation in many other ways. But this settlement pattern also raises
new challenges for those of us working to revitalize low- and moderate-income
areas. While many immigrants enter the U.S. with strong academic credentials and
professional skills, many others find themselves in circumstances similar to nativeborn low-wage and low-skilled workers. Concerns that are common to all include
housing affordability, accessibility of quality health care and education, availability of
living-wage jobs, and neighborhood safety.
Increasing the accessibility of programs and services that help to address these
concerns is paramount to stabilizing low-income households and communities of any
demographic composition. In this issue of Community Investments, we aim to shed
some light on the data and arguments that circulate on both sides of the immigration
debate, and look at ways in which both financial institutions and community
development organizations are working to respond to the needs of a diverse and
growing immigrant population. We hope the articles in this issue help you think more
broadly about the ways you can work to help meet the needs of all those who live
and work in your communities.
Vivian Pacheco
Research Associate
vivian.pacheco@sf.frb.org
Carolina Reid
Senior Research Associate
carolina.reid@sf.frb.org
Naomi Cytron
FIELD STAFF
Jan Bontrager
Regional Manager
Arizona, Nevada, Utah
jan.bontrager@sf.frb.org
Inside this Issue
Melody Winter Nava
Regional Manager
Southern California
melody.nava@sf.frb.org
Crossing Borders, Creating Communities....................... 3
Craig Nolte
Regional Manager
Alaska, Hawaii, Idaho, Oregon, Washington
craig.nolte@sf.frb.org
Community Development in
Dynamic Neighborhoods............................................... 15
Lena Robinson
Regional Manager
Northern California
lena.robinson@sf.frb.org
GRAPHIC DESIGN
Steve Baxter
Communicating Arts
steve.baxter@sf.frb.org
Financial Access for Immigrants.................................... 10
Community Profiles
Arizona.................................................................. 9
Los Angeles, CA................................................... 10
Fresno, CA............................................................ 16
Utah..................................................................... 24
Crossing Borders, Creating Communities
Immigration Trends and their Implications for Community Development
by Carolina Reid
O
n May 1, 2006, hundreds of thousands of immigrants and their supporters marched in communities across the country as part of “A Day without Immigrants.” The parade of white T-shirts
and signs provided a public glimpse into the private hopes
of immigrant families, as marchers shouted slogans calling
for the opportunity to work in this country and pursue their
own “American Dream.”
Among those marching in San Francisco was Maria, an
undocumented immigrant from El Salvador. Maria came to
the United States five years ago, and lives with her sister
in the Fruitvale neighborhood of Oakland. She generally
earns between $300 and $500 a week cleaning houses in the
Oakland hills—far below a living wage in the Bay Area—but
enough to contribute to the household’s expenses and provide for her basic needs. Although her daughter was born
in the U.S. and is therefore a citizen, fear of immigration
officials keeps Maria from seeking out mainstream social
services such as food stamps, and she relies primarily on her
social networks within the Salvadoran community for financial support.
Stories like Maria’s are at the heart of the debate over
the costs and benefits of immigration. Do immigrants like
Maria—willing to work for very low wages—hurt the labormarket outcomes of native born workers? Or are immigrants
working in jobs that Americans are unwilling to do? Are they
placing an undue burden on public services, particularly in
cities that serve as immigrant gateways? Or do immigrants
pay more in taxes than they use in government supports?
The answers to these questions are not straightforward,
particularly when we take into account the incredible diversity of immigrants and the skills and services they provide.
For every three immigrants working in low-wage service occupations like farming and housekeeping, two work in professional or managerial positions such as finance, medicine
and computer science.1 More than one in three immigrants
becomes a U.S. citizen.2 Indeed, the majority of Hispanics
and Asians living in the U.S. today are citizens—many of
them native-born—despite the tendency to conflate race or
ethnicity with immigrant status. And while the majority of
undocumented immigrants may come from Mexico, the undocumented also include European and Canadian students
and tourists who overstay their visas. As such, immigration
policy must contend with a complex and intertwined set of
Chart1
economic, social,
cultural, and national security issues, none
of which are easily resolved.
Figure 1.1
Foreign-Born Population
and Percent of Total
Population for the United
States: 1850 to 2000
Source: Schmidley, A. Dianne,
U.S. Census Bureau, Current
Population Reports, Series
P23-206, Profile of the
Foreign-Born Population in
the United States: 2000, U.S.
Government Printing Office,
Washington, DC, 2001.
30
Foreign-born population (in millions)
25
Percent of total population
20
15
10
13.2
14.4
13.3
14.8
13.6
14.7
13.2
11.6
9.7
10.4
8.8
6.9
7.9
5.4
5
0
2.2
4.1
5.6
6.7
9.2
10.3
13.5
13.9
14.2
11.6
10.3
9.7
6.2
4.7
9.6
14.1
19.8
28.4
1850 1860 1870 1880 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000
Page 1
October 2006
3
Figure 1.2
Europe and Canada
16%
Other Latin America
23%
Asia
27%
Mexico
30%
Africa
4%
Origin of Foreign-Born Population in the United States, 2005
Source: U.S. Census, American Community Survey, 2005.
In this article, we describe recent immigration trends and
examine the primary economic arguments in the contemporary debate over the costs of immigration. The article sets the
context for this special issue of Community Investments, which
explores the links between immigration and community
development and highlights initiatives across the Federal
Reserve’s 12th District that help immigrants to integrate both
socially and economically into their new neighborhoods.
Trends in Immigration
According to the 2005 American Community Survey
(ACS), the number of foreign-born3 living in the U.S. is 35.7
million, or 12.4 percent of the population. While lower than
the historical high of 15 percent in 1890, the foreign-born
share of the population has more than doubled since 1970,
when it dropped to a low of 5 percent (Figure 1.1). The majority of these immigrants are in the U.S. legally. While estimates on the number of undocumented immigrants vary,
most researchers place the number at around 10.5 million.4
The growth in the scale and diversity of immigration
since 1970 is in part explained by the passage of the 1965
Immigration and Nationality Act Amendments. Before
1965, the U.S. restricted the annual number of immigrants
and used quotas to allocate visas across countries based on
the ethnic composition of the U.S. population in 1920.
As a result, 60 percent of visas were awarded to applicants
from only two countries, Germany and the United Kingdom. The 1965 Amendments repealed the national-origins
quota system, thereby vastly changing the national origin of
immigrants coming to the U.S.. In 1970, approximately 70
percent of the foreign-born were from Europe and Canada.
By 2005, this number had dropped to 16 percent, with 53
percent of the foreign-born arriving from Latin America,
Map 1.1
Foreign-Born Population in the United States, 2000
Legend
Less than 5 percent
5 - 10 percent
10 - 20 percent
More than 20 percent
4
October 2006
Figure 1.3
Number of Foreign-Born
2005
State
California (1st)
9,611,356
Arizona (8th)
843,296
Washington (10th)
750,258
Nevada (18th)
413,298
Oregon (20th)
344,575
Hawaii (25th)
212,404
Utah (27th)
192,916
Idaho (39th)
76,377
Alaska (45th)
34,368
Foreign Born Population in the States of the Federal Reserve’s
12th District (National rank in parentheses)
Source: U.S. Census, American Community Survey, 2005
27 percent from Asia, and 4 percent from Africa. Thirty percent of immigrants come from Mexico, making it the single
largest country of origins (Figure 1.2).
In addition to the changing composition of the immigrant population, one of the most notable trends in recent
years has been a shift in where immigrants live. In 1990,
about three-quarters of all immigrants lived in just six states:
California, New York, Texas, Florida, Illinois and New Jersey.
Percent Growth in
Immigrant Population
in 12th District States,
2000 – 2005
Source: U.S. Census,
American Community
Survey, 2005
35
These states still serve as important immigrant gateways, and
are home to the largest percentage of immigrants (see map).
But the fastest growth in the immigrant population in the past
15 years has been in “non-traditional” destinations, such as
Colorado, Georgia, Nevada, and North Carolina.6 Rural areas
in states such as Arkansas, Georgia, Indiana, Iowa and Kansas
are also experiencing a rapid growth in ethnic enclaves.7
These trends are mirrored within the communities of
the Federal Reserve’s 12th District. While California is still
home to the largest number of immigrants (Figure 1.3),
growth rates in the 1990s were higher in states like Nevada,
Arizona, and Utah (Figure 1.4). Nevada saw the largest increase in immigration within the 12th District, with the immigrant population growing by 31.1 percent.
The growth of immigrant communities in non-traditional areas can be seen at the metropolitan level as well. Although from a very small base, Boise City topped the list of
cities that saw the largest percentage increase in immigration
during the 1990s (Figure 1.5). As Figure 1.5 shows, many of
the metropolitan areas attracting large numbers of new immigrants in the 12th District are outside California.
In addition, while immigrants have traditionally settled
in inner cities, today more immigrants are moving to the
suburbs, far distant from the historical settlements in Chinatown or Little Tokyo. In Seattle, for example, the foreign-born population in the suburbs grew by 132 percent,
compared with an increase of 53 percent in the city center.8
These demographic shifts are presenting communities with
new challenges and are pressing local governments and
community-based organizations to respond to the needs of
Figure 1.4
30
25
20
15
10
5
0
-5
-10
October 2006
d)
es
th)
th)
th)
th)
th)
th)
th)
th)
2n
tat
24
46
40
11
28
20
50
15
2
(
(
(
(
(
(
(
(
S
(
i
i
a
a
d
on
ho
ah
na
da
sk
rni
ton
wa
ite
Ut
va
izo
Ida
reg
lifo
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ing
Ala
Un
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5
Figure 1.5
Metropolitan Area
1990
Boise City, ID MSA
2000
Percent Growth
4,389
24,224
451.9
Las Vegas, NV-AZ MSA
74,304
258,494
247.9
Portland—Vancouver, OR-WA CMSA
87,211
248,068
184.4
161,830
457,483
182.7
8,301
23,187
179.3
Salt Lake City—Ogden, UT MSA
41,775
114,508
174.1
Salem, OR MSA
16,202
39,993
146.8
Richland—Kennewick—Pasco, WA MSA
11,845
24,482
106.7
Reno, NV MSA
23,364
47,993
105.4
Seattle—Bellevue, Everett WA CMSA
169,798
331,912
95.5
Riverside—San Bernardino, CA PMSA
360,650
612,359
69.8
1,250,693
1,902,304
52.1
Orange County, CA PMSA
575,108
849,899
47.8
San Diego, CA MSA
428,810
606,254
41.4
2,895,066
3,449,444
19.1
Phoenix—Mesa, AZ MSA
Provo—Orem, UT MSA
San Francisco—Oakland—San Jose, CA CMSA
Los Angeles—Long Beach, CA PMSA
Foreign Born Population in Major Metropolitan Areas within the 12th District
Source: U.S. Census 2000
this diverse and growing immigrant population9 (See article
“Community Development in Dynamic Neighborhoods”).
Immigrants and the Labor Force
With the rapid growth of immigration in recent years,
interest and debate about its implications for the U.S.
economy have intensified, particularly with regard to
its impact on the labor market. In 2005, the number of
immigrants in the U.S. labor forced reached a historic
high of 22 million, or 14.7 percent of the total labor
force. Of particular concern is that immigrants compose a
disproportionately large share of the low-wage labor market
(20 percent), and earn considerably less than their native
born counterparts (Figure 1.6). Lack of formal education and
limited English proficiency can hinder immigrants’ economic
mobility, and make it particularly difficult for them to move
into better-paying jobs. As a result, immigrants are more
likely to be poor than the native-born. In 2004, 17.1 percent
of foreign-born residents lived in poverty, compared to 12.1
percent of residents born in the U.S.10
The dominance of immigrant labor in low-wage occupations has prompted a heated discussion over whether or not
immigrants hurt the economic chances of native-born workers, either by directly taking available jobs or by depressing
wages for low-skilled work. If, for example, Maria were not
willing to clean houses for extremely low pay, would demand
for housecleaners increase wages, thereby making the job
6
more attractive to native-born workers? Public opinion polls
show that between 25 and 40 percent of the population believes that immigrants take jobs away from Americans.11 So
while the debate over immigration encompasses more than
its impact on the labor market, this question continues to be
central to the political discussion of immigration policy.
. . . immigration policy must contend with
a complex and intertwined set of economic,
social, cultural, and national security
issues, none of which are easily resolved.
The difficulty of settling the debate is due in part to
our inability to measure the ‘counterfactual’ case—in other
words, how would native born workers be faring today if
there were no immigrants? For example, immigrants generate new jobs by helping to increase productivity, stimulate
investment, and raise demand for new goods and services.
Do these gains in the overall economy offset the jobs they
take? Do immigrants address the gap in low-skilled labor,
particularly as the U.S. population becomes older and more
educated? What other factors may be affecting productivity
and wages, irrespective of the growth in immigrant labor?
October 2006
And are the impacts of immigration different if we measure
labor market changes at the local or national level?
Scholars have used different methodologies to address
these questions, and they have yet to come to a clear consensus on whether immigration has a positive or negative
effect on the labor market outcomes for the native-born. A
report published in 1997 by the National Research Council
reviewed the literature and concluded that immigration had
a negligible effect, reducing the wages of natives by only 1
or 2 percent.12
Scholars have yet to come to a clear
consensus on whether immigration has
a positive or negative effect on the labor
market outcomes for the native-born.
Studies published after this review, however, have presented a more polarized view of the evidence. George Borjas
and his colleagues, for example, have used national data to
argue that the wage effects are negative and larger than what
has previously been found. Between 1980 and 1995, Borjas
estimates that the earnings of low-skilled workers fell 11
percent, and that immigration likely accounted for half this
drop, or about 5 percent.13 More recently, Borjas has claimed
that immigration between 1980 and 2000 drove down lowskill wages by 8.9 percent.14 And there is some evidence
that immigrants may be displacing natives from jobs. For
example, RAND researchers found that in California, from
1970 through 1999, “between 1 and 1.5 percent of the state’s
adult native population … left the workforce or became unemployed because of competition from immigrants.”15
Other research, increasingly associated with the work of
David Card at UC Berkeley, has shown little or no effect of
immigration on the wages or job opportunities of Americans. He argues that data from the 2000 Census show that
wages of native-born, high school dropouts are unrelated to
the increase in low-skilled immigrant labor.16 His research
also argues that local labor markets can effectively absorb
immigrants and the services they provide. For example,
Card examined what happened after the 1979 Mariel Boatlift, which increased Miami’s workforce by 7 percent practically overnight with an influx of relatively unskilled Cubans.
Even at this very local scale and with the possibility of direct
competition for local jobs, Card found no increase in unemployment or other negative impact among less skilled blacks
or other native workers.17
The studies cited here all use credible data and methods
to come to their conclusions, making it difficult to evaluate
which research better reflects reality. But let’s put the numbers in this debate into perspective. There are approximately
43.1 million low-wage workers in the U.S., 8.6 million of
whom are foreign-born. If Borjas’s largest estimates are correct, these workers might be earning 9 percent more today
without the negative effect of immigration. For someone
earning an annual salary of $20,000, that translates into a
salary of $21,800, a raise of about $1,800. While this is a
significant increase, it still translates into a wage far below
what is needed to afford a two-bedroom apartment at fairmarket rent in all but a handful of states.18 So while this
debate has garnered a lot of press, it is worth noting that
even if immigration has a negative effect on wages, the larger
issue is the growing gap between wages on the low rungs of
the income ladder and the cost of living. As such, it may be
more important to think about how to improve the labor
market potential and earnings of all 43 million low-skilled
workers and ensure that these workers have a high enough
wage to make ends meet.
Figure 1.6
Foreign-born workers
Female
Male
Native workers
Female
Male
Wage Level
Less than minimum
13%
9%
9%
6%
100-200% of minimum
40%
36%
31%
20%
>200% of minimum
47%
55%
61%
75%
$26,700
$38,400
$29,700
$47,500
Mean Annual Earnings
Wage Levels and Income of Workers by Nativity and Sex, 2002
Source: Randolph Capps, et al. (2003). A Profile of the Low-Wage Immigrant Workforce.
Washington, D.C.: The Urban Institute.
October 2006
7
The Fiscal Costs of Immigration
Conclusion
In addition to the equity concerns in the labor market,
discussions over the costs of immigration often focus on the
fiscal impacts of immigrants. Do immigrants place an undue
burden on already strapped government budgets? As with
the labor market question, the methodology and assumptions used to analyze this question have a large bearing on
the results. But, at the federal level, the majority of studies
support the view that immigrants—both legal and undocumented—result in a large positive fiscal impact.19 According
to the 2005 Economic Report of the President, “More than
half of undocumented immigrants are believed to be working ‘on the books,’ so they contribute to the tax rolls but
are ineligible for almost all Federal public assistance programs and most major Federal-state programs.”20 Moreover,
research on the foreign-born generally finds that they are
less likely than natives to use public services and that most
of those who do use them are refugees.21 As a result, immigrants are increasingly being seen as an important taxpayer
base that can help to ensure the future solvency of Social
Security and Medicare.
On balance, most of the research on immigration suggests that politicized statements about the negative impact
caused by immigrants in the U.S. are largely unfounded.
The National Research Council study’s ‘immigration balance sheet’ suggests that immigration provides the U.S. a
net benefit of around $80,000 per immigrant, or as much as
$10 billion annually.23 And while there may be some costs
associated with job or wage loss among native-born workers
in direct competition with low-skill immigrants, these costs
appear to be relatively small in relation to the larger forces of
economic restructuring, globalization, and new technologies
in the workplace.24
For the community development field, the challenge is
to respond to the growth, diversity and settlement patterns
of immigrants proactively and ensure that they are able to
access the resources they need to achieve financial security.
Many of the characteristics of immigrant families are shared
by all low-income households—such as low wages, limited
job skills or education, and lack of access to services such
as child care. Yet in immigrant families these problems are
often compounded by limited English proficiency and cultural differences that affect the uptake of services. As immigrants have shifted to living in new communities, the
community development field must evolve to meet the
needs of this diverse population, particularly with regard to
language services and cultural competencies25 (See “Community Profiles”).
But the growth in immigration also holds much promise
for the field. For example, immigrants are proving to be a
viable market for financial services, including not only transaction accounts but also home and small business loans (See
article “Financial Access for Immigrants”). Immigrants can
also help to spur commercial revitalization and strengthen
neighborhoods and communities. In many inner cities, immigrants are fueling an economic recovery by stimulating
demand for housing and rejuvenating small business activity
in once-abandoned commercial corridors.
In the end, the economic impact of immigration on the
U.S. economy will be shaped far more by how we help lowincome immigrant families succeed than by the length of the
fence at the border. The effects of poverty on families and
communities are negative and costly over the long-term, regardless of nationality or immigrant status. Helping to expand
access to opportunity for those on the lower rungs of the labor
market, such as improving education and training, increasing
the availability of health insurance and child-care services,
and supporting protective policies such as minimum wage
laws, will translate into better outcomes for all low-income
families and the neighborhoods in which they live.
For the community development field,
the challenge is to respond to the growth,
diversity and settlement patterns of
immigrants proactively and ensure that
they are able to access the resources they
need to achieve financial security.
At the local and state level, however, studies show that
immigrants can impose a fiscal cost, although the magnitude
of that cost differs depending on the choice of time horizon.
Relative to the native population, immigrant households
have more children, meaning that on balance they ‘use’
more public education funding. Yet studies that find a large
fiscal drain associated with educating immigrant children
generally rely on static, short-term cost analyses.22 In other
words, these studies do not account for the long-term tax
contribution that these children provide once they join the
labor force. Once that contribution is taken into account,
there is no negative impact. And it is worth noting that the
negative fiscal impact at the state and local level holds true
for children in native-born families as well.
8
October 2006
Community Profile: Arizona
Chicanos Por La Causa
B
etween 1990 and 2000, Arizona saw a 136
percent increase in its foreign-born population, and among the foreign-born population
in the state in 2000, 72 percent were born in
Latin America. With its farming regions that are home
to year-round growing and harvesting of greens, cotton,
pecans, melons and tomatoes and a booming construction industry, Arizona is drawing Hispanic immigrants
who are increasingly finding it possible to establish their
own roots in the state.
A strong infrastructure to support both new and
more established Hispanic immigrants in Arizona has
been built in part by Chicanos Por La Causa (CPLC), a
35-year-old community development corporation based
in Phoenix but active throughout the state. CPLC’s services, which span education, health, housing, and economic and cultural development, aim to address comprehensively the needs of a diverse and, in some respects,
difficult-to-reach immigrant population. Max Gonzales, CPLC’s vice president of Community Affairs, said
that among the communities it serves, “There is some
commonality—as far as safety, health, and employment
needs—but we are trying to understand the specific interests of a number of subgroups within the immigrant
population.” CPLC helps more established immigrants
take part in asset-building activities such as homeownership and business development. Last year alone, 500
families were able to become homeowners, and 3,500
individuals took part in business “seminario,” workshops
about business planning, access to capital, and management that are conducted in Spanish.
For newly arriving immigrants, CPLC offers assistance
in accessing more fundamental education and health-related services. CPLC’s Head Start program, which targets
migrant and seasonal farmworker families, represents
one of these doorways through which newer arrivals to
the state can access CPLC’s integrated network of programs and services. The program offers full-day, full-year
care and education for children aged six weeks to five
years old, and “provides a safe and secure place for kids
to go, contributes to later success in schools, and offers
avenues for intervention and prevention of a variety of
health and safety issues,” said program director Laura
Walker. In addition, the program prioritizes parental involvement. Referrals are provided for job training and
computer literacy classes, English as a Second Language
October 2006
and GED High School Equivalency classes, financial
and legal counseling, housing assistance, and a variety of
other services.
Annually CPLC’s Head Start program is able to reach
nearly 700 children and their families. However, Walker
estimates that this figure represents only 19 percent of
eligible children—and only 1 percent of eligible infants.
With the need for bilingual staff and intensive outreach
methods, reaching all families in need is difficult, and
budgetary constraints limit the number of children they
are able to enroll. Despite limitations, though, Walker
views this program as a vital element in creating stable
communities. In addition, she noted that partnerships
with schools and hospitals have been critical in augmenting their ability to serve clients.
Gonzales noted that partnerships with Spanish and
English media outlets, as well as with nontraditional partners such as the local energy company, have also broadened CPLC’s ability to reach out to community members.
In addition, CLPC has evolved in response to community
interests—in some cases merging or acquiring other nonprofit organizations, in other cases creating or expanding
programs and services to address emerging needs.
Both Gonzales and Walker emphasized the scope of
benefits that can stem from supporting a segment of the
population that continues to grow. “The economic benefits of increasing the availability of early development
and health programs for immigrant families, for example,
would be enormous,” said Walker, citing the growing
body of research showing the positive economic impacts
of early childhood care.1 While Gonzales indicated that
some of Arizona’s financial institutions and corporate
entities have begun to tap into the substantial market opportunities presented by the immigrant community, he
also said that “current political climate has contributed
to some reluctance on the part of corporate and financial
institutions to engage with immigrant communities, and
there is room for increased commitment and support.”
CPLC’s own commitment to integrating economic
and human development through a host of services and
programs is a locally and nationally recognized community development model. As Gonzales said, “Regardless
of how long people have been part of this community, we
aim to help them achieve stability through education and
services… We try to engage and empower families and
kids to help them succeed.”
9
Community Profile: Los Angeles
Asian Pacific Islander Small Business Program
A
s of the 2000 Census, just over 40 percent of
the population—or 1.5 million people— in Los
Angeles were foreign-born. A longtime magnet
for peoples from all over the globe, Los Angeles continues to attract new immigrants from countries
throughout Asia and Latin America. For immigrants
with self-employment goals, linguistic, cultural and financial barriers to starting and maintaining a business can
be high. The Asian Pacific Islander Small Business Program (API SBP), a microenterprise development program,
aims to minimize these obstacles by delivering culturallycompetent small business services to the growing number
of Asian ethnic communities in Los Angeles.
“Cultural competency is essential for
developing appropriate community
outreach strategies.”
The impetus to develop API SBP emerged during the
aftermath of the Los Angeles riots of 1992, which saw
widespread looting and burning of many Korean businesses. Many business owners were uninsured, and the
resulting economic losses meant that they were suddenly
unable to afford household rent or college tuition. Many
families doubled up into apartments and children were
pulled out of school. Cook Sunoo, director of API SBP,
said that the situation called attention to the marginal
nature of many Asian-owned businesses in Los Angeles:
“With the high levels of entrepreneurship in many of the
Asian communities, it became clear that social welfare
was highly correlated with the health of small businesses
in those communities. However, government support for
small businesses was not adequately serving the needs of
immigrant and ethnic communities.” Sunoo noted that
at the time, out of the nine SBA-run Small Business Development Centers in Los Angeles, only one had staff
with Asian-language capabilities.
This lack of support pointed to the need to deliver
additional business development services to subgroups
10
within the Asian community, but the challenge was in
determining how to conduct outreach in a variety of languages and maintain sensitivity to a growing spectrum
of cultural differences, all while operating with limited
funding and resources. The leadership of Chinatown
Service Center, Korean Youth & Community Center,
Little Tokyo Service Center CDC, Search to Involve
Pilipino Americans, and Thai Community Development
Center—all of which are established social service organizations—decided to create API SPB as a collaborative in
order to efficiently support entrepreneurs and advance
economic development in each of their communities. A
collaborative structure allows administrative and managerial resources to be pooled while also enabling the
program to have broad reach into a number of unique
communities. It also allows the organization to approach
financial institutions and foundations as a unified voice.
Broad cultural knowledge—as well as strong business
acumen—is required of staff, who can now offer individual
counseling and group workshops in six languages. “Cultural competency is essential for developing appropriate
community outreach strategies,” said Sunoo. For instance,
he noted that religious institutions are often gateways for
reaching community members in need of business services, but while it can be acceptable, for example, to conduct business-related outreach on the grounds of a Thai
temple, the same activity would likely be frowned upon
on the grounds of a Korean church. Cultural competency
also means understanding the stresses that business ownership can place on families and children. To address some
of those ancillary issues, API SBP’s programs also aim to
link clients to a host of other services, including child care,
family counseling, and tutorial programs for youth.
Since its inception, API SBP has sought to break down
the linguistic and cultural barriers that have excluded immigrants from mainstream business development services. The vision of API SBP is to expand its services so that
it can reach other Asian ethnic groups for whom a service
void still exists, including Vietnamese and Cambodian
communities. Said Sunoo, “There is a need for additional
economic development and technical assistance to make
sure that the whole range of Asian businesses can fully
participate in the Los Angeles economy.”
October 2006
Financial Access for Immigrants
The Challenges and Opportunities
Facing U.S. Depository Institutions
by Robin Newberger and Anna Paulson, The Federal Reserve Bank of Chicago
Audrey Singer, The Brookings Institution
Jeremy Smith, independent consultant1
Introduction
n the past decade, immigration has changed from a
phenomenon that had a major impact on just a few
places to one that influences nearly every community
in the United States. In the district served by the Federal
Reserve Bank of San Francisco, immigrants make up about
a fifth of the total population, an even greater share than
for the U.S. as a whole. Whether they come seeking economic opportunity or fleeing political turmoil, immigrants
are finding common ground with the native-born in their
shared wish to create a safe, secure, and prosperous future
for themselves and their children. Financial access—knowing
one’s financial options and having products and services to
choose from—is fundamentally linked to economic prosperity. The extent to which immigrants participate in the banking system is a key measure of success in terms of integration
into the economic mainstream, and has relevance for many
groups, including bankers, consumer advocates, policymakers and immigrants themselves.
Overall, immigrants are much less likely to use the financial mainstream compared to individuals who were born in
the United States. While 76 percent of native-born household heads have a checking account, the same is true for
I
only 63 percent of immigrant household heads (see Table
2.1). This pattern holds for savings accounts, homeownership, and stock ownership as well, with the gap between
immigrant and native-born connections to the financial
mainstream increasing with the sophistication of the financial product. This article reviews recent research identifying
key factors that affect immigrants’ financial participation,
describes some of the steps banks have taken to meet the
financial needs of immigrants, and identifies additional opportunities that can help draw more immigrants and their
families into the banking system.
Why are Immigrants Less Likely to use
Banks than the Native-Born?
Immigrants’ decisions to avoid banks on the one hand
and patronize the alternative financial services sector for
check-cashing and remittance services on the other find their
roots in three broad factors.
First, socioeconomic and demographic characteristics
like age, education, ethnicity, and income play a role in
immigrant as well as native-born choices regarding financial
services. These characteristics are only part of the story,
Table 2.1
Share of Immigrant Heads of Households who have:
Country of Origin
Checking or
Savings Account
Checking Account
Savings Account
Mexico
27%
26%
40%
China
48%
61%
78%
Philippines
63%
52%
76%
India
65%
56%
77%
Vietnam
49%
28%
56%
Cuba
49%
34%
59%
Korea
56%
38%
68%
Canada
75%
57%
85%
El Salvador
34%
25%
44%
Germany
72%
66%
87%
Source: 1996-2000 SIPP data.
October 2006
11
however. Immigrants are less likely to have checking and
savings accounts compared with the native-born, even
after taking into account differences in socioeconomic and
demographic factors.
The extent to which immigrants
participate in the banking system is a key
measure of success in terms of integration
into the economic mainstream.
Second, characteristics that are unique to immigrants–
time spent in the United States, language barriers, intentions
of returning to their native country, an orientation toward
country of origin institutional norms, perspectives on the
trustworthiness of institutions like banks, legal status, and
the tendency to cluster in neighborhoods with other immigrants from the same country–shape their financial choices
as well.
Finally, these choices are influenced by the features of
products and services offered by banks compared with those
offered by the alternative financial services sector including: cost, anonymity, documentation requirements, minimum balance requirements, and convenience – both in the
United States and, in the case of remittances, in the country
of origin. Less tangibly, but of enormous importance, the
“culture” of the institution determines how welcoming and
familiar it feels to a potential immigrant customer.
Minimum balance requirements are among the most
burdensome barriers to opening a bank account, and survey
responses among Latin American immigrants show negative
views about high minimum balance requirements.2 Another
bank policy that can discourage immigrant financial participation is the use of the ChexSystems database to screen out
potential customers with a lack of, or a poor, credit history.
About 80 percent of U.S. bank branches use the database to
run credit checks before opening accounts for prospective
customers. A related issue is that some immigrants cannot
meet the documentation requirements imposed by banks.
While banks are not required by law to ask customers for
Social Security Numbers and can choose to accept alternative forms of identification, many banks still do ask for
Social Security Numbers to open an account or conduct
other business (See Box 2.1, New Forms of Customer Identification and the USA PATRIOT Act).
Convenience and accessibility of financial services also
drive immigrants’ decisions on where to conduct basic
financial practices such as cashing checks and sending
remittances. Sending remittances is one of the most common
and important financial transactions among immigrants.
Remittances are sent by the entire range of immigrants:
documented and undocumented; permanent and temporary;
upper- and lower-income; middle-aged and young; married
and single; and male and female.3 However, most immigrants
and their families use money transfer operators, not banks, to
New Forms of Customer Identification and the USA PATRIOT Act
Box 2.1
Section 326 of Title III of the USA PATRIOT Act*, the International Money Laundering Abatement and Anti-Terrorist
Financing Act of 2001, requires financial institutions (or third-party agents performing services on their behalf) to keep
and report accurate records that verify the identities of their “customers,” particularly as those records pertain to money
laundering, terrorism, identity theft, and fraud. Customer Identification Programs (CIPs) require banks to collect the name,
address, date of birth, and tax identification number of a prospective customer in addition to any other information that a
bank’s particular account-opening procedure requires. A bank’s CIP must: (1) specify the identifying information that will
be obtained from each customer; (2) verify the identity of each customer; (3) retain the identifying information obtained at
account opening for five years after the account is closed; and (4) determine whether a customer is on any federal government list of terrorists.
Under the Treasury Department’s final rules for implementation of this part of the USA PATRIOT Act, acceptable forms of
identification include Social Security Numbers and driver’s licenses, as well as foreign government-issued identification
and consular identification cards. Whether a bank chooses to accept alternative forms of identification depends on the
amount of risk it is willing to assume with respect to its ability to verify the identity of each customer. The USA PATRIOT Act
requires that institutions that accept the Matricula Consular card take reasonable steps to ensure that they have verified
the identity of the customer through documentary or non-documentary means.
*The formal title is the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act. The Act was signed into law in October 2001.
12
October 2006
Despite institutional barriers that can
limit financial access, the trend in recent
years has been for banks of all sizes to
reach out to rapidly-growing immigrant
populations.
send and receive remittances, and even immigrants with bank
accounts do not necessarily use banks to send remittances.
In one survey, just 22 percent of remitters who had a bank
account used a bank to send remittances.4 Part of the reason
relates to lack of information—another study showed that
only a fraction of the remittance senders with bank accounts
understood that they could use the bank to remit money
to their native countries.5 Reliable service, extended hours,
and staff that speaks the language of customers are other
reasons why immigrants send remittances via money transfer
operators versus banks.
How Banks are Reaching Out to Immigrant
Populations
Despite institutional barriers that can limit financial
access, the trend in recent years has been for banks of all
sizes to reach out to rapidly-growing immigrant populations.
Motivated largely by a business rationale, banks and credit
unions have led the charge in raising public awareness about
the growth of the immigrant market.
For small banks or community banks, reaching out to
immigrant customers can be matter of survival. On average,
community banks finance 40 to 65 percent of their assets
using local household and business deposits, compared with
about 30 percent for large banks. As the neighborhoods that
many serve undergo dramatic demographic changes, small
banks have transformed their business strategies to work
with new customer bases.
Large banks have also been critical to bringing immigrants into the financial mainstream. Large banks account
for less than five percent of all banking institutions in the
U.S., but they hold more than three-quarters of all bank deposits. Hence, the policies of a single large bank can have
repercussions for millions of potential clients across the
country.
“Hybrid” entities represent another set of banking institutions that have had success in reaching immigrants. These
include banks and credit unions that combine the services
usually associated with check-cashing companies with the
products associated with depository institutions. Hybrids
are still experimental, but they are designed to reach just the
kind of customer that many immigrants represent: working
people who pay bills and send remittances, and who regularly patronize check cashers and money transfer operators.
October 2006
Building immigrant acceptance of banking institutions is
a gradual and multi-stepped process. It takes time to understand the cultural backgrounds and diversity of immigrant
populations. Outreach often requires making large up-front
investments in marketing, staffing, and training – investments
whose returns may take years to realize. The time line may
even extend to the children of immigrants. Tapping into the
financial services opportunities offered by the growth in the
immigrant population, therefore, requires mainstream institutions to be patient and flexible. They must also be willing
to take on a complex and evolving regulatory environment.
Building trust
A first step that many banks have taken to get immigrants
in their doors involves building trust within immigrant communities. Some of this has meant changing the methods that
banks use to interact with clients, such as hiring bilingual
staff, providing multicultural training for bank workers, and
redesigning websites and ATMs. Some of this activity has
also led to making branch lobbies more inviting, and adding
or switching advertising channels.
Another fundamental way that banks have built trust
among immigrants has been through the cultivation of relationships with churches, schools, and other community organizations that immigrants know and respect. By working
with these community actors, bankers hope that the trust
that immigrants place in these organizations will transfer
to the bank. For their part, community-based nonprofits,
schools, employers, and other community organizations
Matricula Consular
Box 2.2
The Matricula Consular card is an official national
identity card issued by the Mexican government
through its network of consulates in the United
States. In 2002, security enhancements were made
to the card and it was redesigned as the High Security
Consular Registration Card, though it is still known
informally as the Matricula Consular card. The card
provides a name, address, and identification number
for bank customer identification programs. While
other Latin American governments have begun to
issue similar cards, the Matricula Consular is the
most widely circulated, carried by more than 4 million
Mexicans in the United States as of 2005, according
to the Mexican government. Of these, 2.2 million carry
the high security version of the card. Although the
Matricula allows immigrants to open accounts at many
banks in the U.S., it must be used in conjunction with
a Social Security Number or an Individual Taxpayer
Identification Number to open an interest-bearing
account or to engage in other taxable bank activities.
13
often have their own stake in whether immigrants join
the financial mainstream. For example, Boat People SOS,
a national agency that helps Vietnamese refugees become
economically self-sufficient, approached Citibank with the
prospect of becoming involved in its Individual Development Account program. Once this relationship was established, representatives from Citibank and other banks sent
staff to volunteer at Boat People SOS.
Accepting alternative forms of identification
A second important tactic banks have used to reach immigrants is to accept alternative forms of identification to
open accounts. Some banks accept driver’s license numbers,
consular-issued identification cards and Individual Taxpayer
Identification Numbers in addition to Social Security Numbers. Wells Fargo, for example, became one of the first major
banks to accept the Matricula Consular card for Mexicans,
and later for Guatemalan immigrants.6 As of November
2003, Wells Fargo had opened 250,000 accounts for Matricula Consular card holders in California, Texas, Arizona, New
Mexico and elsewhere7 (See Box 2.2, Matricula Consular).
Anti-money laundering and anti-terrorism legislation, the
main legislation that impacts this area, has made it clear that
Social Security Numbers are not required to open bank accounts. Hundreds of banks in the United States now accept
the Matricula Consular card to open bank accounts either
as a unique source of identification or in conjunction with
a second piece of documentation. A growing number of financial institutions also accept Individual Taxpayer Identification Numbers, known as ITINs, as documentation for
Directo a México
Box 2.3
“Directo a México” offers an inexpensive remittance
system for banks interested in serving the Mexican
market.
Launched in 2004, “Directo a México” is an automated
clearinghouse money transmission option available
to virtually every depository institution in the United
States. Developed by the Federal Reserve, the service provides direct access to all bank and most credit
union accounts in Mexico. It requires both remittance
senders and recipients to have bank accounts. To date,
only a few small- and medium-sized banks have used
the system. In a pilot program begun in April 2006, “Directo a México” is experimenting with allowing remittance senders to set up bank accounts for remittance
recipients at participating bank branches in Mexico.
14
opening interest-bearing accounts.8 Obtaining these numbers has become more difficult in recent years, however, and
ITINs must be used in conjunction with other identification
due to regulatory requirements.
Offering services usually associated with check-cashers
and money transfer operators
Banks are also competing for immigrant clients with entities such as check-cashers and money-transfer operators.
Beyond the few “hybrid” models, many banks and credit
unions offer check-cashing for non-account holders, money
orders, and non-financial products like phone cards, along
with low-cost savings and checking accounts. A 2004 study
found that at least 60 U.S.-based depository institutions, including the largest banks as well as community banks and
credit unions, offer remittance products.9 There are numerous methods available, including debit or dual ATM cards,
credit cards, account-to-account transfers, and stored value
cards. In Bank of America’s SafeSend program, for example,
checking account customers can send remittances to Mexico
at no charge. San Francisco-based Xoom is an online remittance system that sells its technology and infrastructure
as a turnkey system for regional and community banks.10
The Federal Reserve has also begun to promote remittances
through the banking system with the “Directo a México”
program, an automated clearinghouse money transmission
option (See Box 2.3, Directo a México).
Moving clients up the financial ladder
So far, the marketing of transaction accounts and remittance products has been the first crucial step that many
banks have taken to get immigrants in their doors. A smaller
number of banks are also trying to match their immigrant
customers with higher-end financial products. Union Bank
of California, for example, has developed an array of credit
products for low-income and immigrant borrowers, such
as secured credit cards, new and used car loans, small business loans, and mortgage products, aimed at helping clients
either build credit histories or build assets.
Homeownership is one area beyond basic banking and remittances where financial institutions have been able to take
advantage of growing demand by immigrants. Although immigrant homeownership (at 55 percent) lags behind that of
the native-born (at 76 percent)11, immigrant households are
projected to account for approximately one-third of all new
households between 2000 and 2020.12 Many of the mortgage products developed for immigrants are part of broader
minority homeownership initiatives that offer flexible credit
underwriting standards and take into account the contribution of the extended family in determining the income of a
prospective borrower.
A small number of banks also offer home mortgages
using ITINs for people without Social Security Numbers.
Working with ACORN in California, for example, Citibank
October 2006
created a new mortgage product to make mortgages available
to immigrants who have previously been shut out of credit
markets.13 For all lenders, though, the lack of a secondary
market for ITIN loans has limited the growth in this area.
Future Opportunities
ty and lower turnover rates could benefit employers as well,
particularly large firms that employ significant numbers of
immigrants. In addition, large employers operate at a scale
at which significant savings may result from having a greater
proportion of their payrolls delivered through direct deposit
or stored value cards.
As the immigrant population continues to grow, there
are many opportunities to link immigrants to the mainstream financial system.
Offer check-cashing and money transfer services
One potentially fruitful approach is for more banks to
offer the services that immigrants want but currently receive
through check-cashers and money transfer operators. If more
banks were to provide and advertise remittances, bill-paying
and check-cashing services, immigrant customers would
benefit from lower fees resulting from greater competition
(even for those who continue to use check-cashers), as well
as from the opportunity to open checking and savings accounts. The advantage to banks and credit unions would be
additional fee income as well as the chance to grow their customer bases. And regulators would benefit from increased
transparency and simplified enforcement of money laundering and anti-terrorism legislation as more check-cashing
and bill payment transactions were conducted through the
banking sector.
Reach out to the children of immigrants
Another potential strategy for banks is to reach out
to the children of immigrants through the school system.
There already exist numerous bank-school and credit unionschool partnerships throughout the country, although not
necessarily with a focus on the children of immigrants. By
2020, second generation Latinos are projected to outnumber
their parents. In addition to representing a large and growing future market opportunity, the children of immigrants
may be easier for banks to connect with than their parents.
Roughly three-quarters of school age children with an immigrant parent are U.S. citizens. The children of immigrants are
also more likely to be proficient in English. Bank branches
in high schools, such as the Bank Within East, a Wells Fargo
branch at East High in Anchorage, Alaska, could expand financial education opportunities for the nation’s high school
population.
Offer financial services through the workplace
A third opportunity for banks is to connect with immigrants through their places of employment. Immigrants
make up 12 percent of the U.S. population but 15 percent
of all workers.14 Banking at work could save time for busy
immigrants who often cite convenience as a primary reason
for using check-cashing outlets. For banks, the workplace
offers the opportunity to connect with large numbers of immigrants who are ready for and in need of financial services.
Company-sponsored financial initiatives that increase loyal-
October 2006
It is important to create a financial
system that offers access to those who
want it.
Target immigrant neighborhoods
Finally, banks may realize substantial customer growth
by targeting immigrant neighborhoods. Immigrant enclaves,
neighborhoods with a high percentage of foreign-born residents from the same country, are often places with particularly low bank account ownership. However, inroads into
account ownership in ethnic communities may be multiplied through immigrant networks and word-of-mouth
among people who rely heavily on one another for information. Getting just one immigrant to open a new bank account may lead many others to do the same as they learn
about the process and the benefits of account ownership
from an individual who shares their country of origin and
language. Partnerships among banks, ethnic community
groups, and other organizations with abundant credibility
in the immigrant community are instrumental for realizing
this opportunity.
Conclusion
Efforts to connect immigrants with the financial mainstream are happening against a backdrop of unprecedented
immigration to the U.S. Today, at least one in nine residents
of the U.S., or 35 million people, was born abroad. Immigrants have many different needs and banks may not be right
for everyone. It is clear, though, that the extent of financial
access is an important indicator of the overall economic and
social well-being of an area. How immigrants integrate financially into the U.S. has repercussions not just for a few
cities or states, but for neighborhoods and communities
throughout the country. It is important to create a financial
system that offers access to those who want it.
Immigrants are changing as they adapt to the U.S., and
the U.S. is in turn changing as newcomers are, to varying
extents, accommodated and incorporated. The challenge is
to ensure, as much as possible, that these transformations
strengthen communities and families across the nation, that
they benefit immigrants and the native-born, help financial
institutions build sustainable business models, and take into
account the wisdom and the expertise of the community.
15
Community Profile: California’s Central Valley
Fresno Center for New Americans
I
n the late 1970s and early 1980s, the Hmong, an
Asian ethnic group from the mountainous regions
of Southeast Asia, faced persecution, especially
the Hmong in Laos and those who had aided the
American forces during the Vietnam War. Many sought
refuge in Thai refugee camps and in Western nations. In
the U.S., three areas— California’s Central Valley, Minnesota, and Wisconsin—became home to the vast majority of Hmong refugees. A second wave of Hmong refugee settlement occurred in 2004 and 2005, and out of
the 15,000 arrivals to the U.S., an estimated 2,500 new
refugees joined the Hmong community in Fresno, with
others expected to arrive in the coming years.
“There are so many issues that surface when a new
group of people settles in a given area. Where will they
live? What about jobs? Where will their kids go to school?
What about health care?” asked Silas Cha, associate director of the Fresno Center for New Americans (FCNA).
FCNA, established in 1991, works to address those and a
host of other questions about how to meet the needs of
the estimated 30,000 Hmong refugees in the area.
The answers are complicated when dealing with a
refugee population with a unique history and a unique
set of cultural beliefs and practices, not to mention linguistic barriers. Coming from Thai refugee camps with
few employment opportunities, limited health services
and schools, and the lack of running water in living quarters, “culture shock is inevitable,” said Cha. “And there is
a lot of cultural conflict, particularly over the treatment
of health issues.” For example, “soul loss” has traditionally been perceived as the root cause of illness, and the
Hmong have relied on shamans and sacrifices, rather
than methods used by Western physical and mental
health practitioners, to restore well-being.
Even for the Hmong families who arrived during the
first wave of settlement, challenges remain when it comes
to attaining quality housing and employment that offers a
supporting wage. Hmong families are typically very large.
In 2000, the median household size for Hmong families
in the Central Valley was seven people, compared with
fewer than three people in the population at large. Cha
noted that because of the high cost of housing, FCNA
sees Hmong families overcrowding in small apartments
in unsafe neighborhoods. And although many of the
Hmong have been able to engage in agricultural work
and own small farms in the Central Valley, language barriers and other skill deficiencies contribute to their high
unemployment rate and low incomes.
16
The situation is certainly complicated, but Cha notes
that “there has been a lot of optimism over the past year
and a half.” To help smooth the transition for new refugees, FCNA and other services providers recently took
the initiative to form the Hmong Resettlement Task
Force along with elected officials, city, county, and state
government representatives, and school board members.
In addition, private foundations have provided funding
for long-term programs to help families learn how to
access and navigate the health-care system. Cha noted
that as a result of community health education and the
increase in Hmong health-care professionals, an increasing number of Hmong are becoming more receptive to
Western medical treatment. He also noted that members
of the Hmong community are beginning to gain leadership roles where they can help shape public policy.
Programs run through the FCNA and other social
service agencies in the Central Valley are also helping to
acculturate refugees, foster leadership, and change the
policy environment. FCNA’s offerings include English as
a Second Language classes, health education and referrals, and employment services. In this last capacity, case
workers are able to work with both job seekers and employers in filling out applications, explaining workplace
issues like safety codes, and resolving misunderstandings
that may arise because of cultural differences. FCNA
also conducts research, advocacy, and relationship-building to help bring the Southeast Asian community into
the civic mainstream.
But a lot more work needs to be done to help both
established and newly arriving refugees in the Central
Valley gain a firmer footing. “In many ways the Hmong
are an invisible population—on a large scale, we don’t
exist and people aren’t aware of our issues,” said Cha.
“But we need to continue to create programs that are responsive to our unique needs so that we can build healthy
communities.”
The Federal Reserve Banks of Chicago and
Minneapolis have issued several reports on the
Hmong community. Please visit:
http://www.chicagofed.org/cedric/hmong_and_
control_household_and_business_data.cfm
http://minneapolisfed.org/research/studies/hmong/
October 2006
Community Development in
Dynamic Neighborhoods
Synchronizing Services and Strategies with Immigrant Communities
by Kay Fernandez, PolicyLink
Despite growing research about the implications of immigrant markets for the private sector,
there is little research about the role and contributions of community development organizations
in the integration of new immigrants. This article is adapted from a longer report that, through
a review of current literature and interviews with leading experts and community development
practitioners, private lenders, and governmental agencies, explores both how immigration trends
are driving much of the dynamic change in neighborhoods across the United States and the ways
in which community development organizations can work to address changes at the local level.1
I
n order to be most effective, community development
organizations must be increasingly cognizant of and responsive to their changing neighborhoods. The nature
and role of community development has changed
since the 1960s, when grassroots activism attempted to turn
around deteriorating inner-cities. The community development field has evolved as the number of organizations has
multiplied in both urban and rural areas, and in many places
neighborhood demographics have been in constant flux.
Among the most notable of these demographic changes is
the growth in the number and diversity of immigrants to the
United States.
Community development organizations (CDOs) are in a
key position to recognize and address immigration trends at
the local level. Since most CDOs are neighborhood-based
and resident-led, they have a comparative advantage over
governmental agencies in connecting new immigrants to the
socioeconomic fabric of their neighborhoods through housing, economic development, employment and civic-engagement strategies. Given this unique position, CDOs must be
aware of recent immigration trends for three main reasons:
1. Changing demographics indicate a changing marketplace,
with increased demand for new goods and services;
2. Community development organizations can prevent immigrant families from being vulnerable to unscrupulous
practices; and
3. New immigrants contribute to neighborhood-revitalization strategies in various cities, including ones that have
been historically disinvested or communities that are
looking to expand and grow.
October 2006
On the one hand, the increase in new immigrant families
creates demand for housing and business and community
services that can help to revitalize and strengthen neighborhoods in both hot and soft local economic markets.2 Researchers have considered the positive consequences of immigration as they contribute to the rebirth of functioning
private markets in former wastelands — soft markets defined
by population decline, high vacancy rates and unemployment. The settlement of immigrants in disinvested cities can
be major propellant of urban neighborhood revival.3 Soft
market cities such as Pittsburgh and Philadelphia, or even
small cities like Schenectady, NY, now have policies or public
programs aimed deliberately at attracting immigrants.
The continued settlement of immigrants in hot markets
such as Boston, Atlanta or Oakland also can contribute to
revitalization effors. Researchers have noted that “thanks
in large part to Russians in Coney Island and Brazilians in
Newark, Mexicans in Chicago and Houston, and Asians in
Oakland, rundown neighborhoods are suddenly seeing a
burst of new activity — not just in the number of residents,
but in small-business investment, street life, and an asset
that hardly anyone associated with these places 20 years ago:
cultural élan.”4
On the other hand, the challenges posed by the influx
of immigrants into both hot and soft markets means an
increased role for community-organizing and communitybuilding activities, especially in regard to housing and tenant
rights, workforce development and education and counseling. As the demographics and marketplace change, CDOs
must recognize the barriers to addressing the community development needs of immigrant communities. Some CDOs
17
have conducted extensive needs assessments in their neighborhoods and found that new immigrants quickly move out
of neighborhoods that lack affordable housing and job opportunities in search of better conditions. This constant outmigration of residents causes instability in neighborhoods
where one low-income community is replaced by another.
CDOs have an opportunity and responsibility to stabilize
the neighborhoods, and can do so by supporting and encouraging immigrants to make long-term investments in the
community through homeownership, education and job
opportunities.
“Immigrants have been the backbone of stability in
many struggling neighborhoods. With their aspirations,
immigrants have been fueling the stability of distressed
neighborhoods. They are and will continue to be the future
renewal of many cities,” said Kenneth Wade, chief executive officer of NeighborWorks America.5 Unfortunately, in
many communities, mainstream market channels overlook
the fact that immigrants are a significant economic force.
The increasing presence of immigrants in small towns and
rural areas, as well as the continued growth of the immigrant
population in traditional gateway cities, has implications for
CDOs, the neighborhoods they work in, the immigrants
themselves, and the long-term revitalization strategies of
community development.
Community development organizations
(CDOs) are in a key position to
recognize and address immigration
trends at the local level.
How Can CDOs Respond to Changing
Demographic Profiles?
The level of demographic change that warrants a community development response varies greatly according to
the degree and length of immigrant presence, the capacity
of the organizations to adapt, and the availability of existing resource networks. Gateway cities like Los Angeles,
Chicago, New York and Miami have a long history with
immigrants. Their networks are relatively sophisticated, yet
many newcomers experience isolation within their own
neighborhoods. In some areas, ethnic-focused community
development organizations have emerged to fill the need
for language-specific, culturally appropriate programs that
address housing discrimination and small business development. Furthermore, established organizations have
Understanding Local Immigrant Characteristics
It is difficult to design services without a basic understanding of an immigrant group’s socioeconomic, historical
and cultural characteristics. This table presents some of the questions that CDOs have found it important to ask
when trying to understand the specific characteristics and needs of local immigrant communities.
18
Characteristics
Questions
Settlement patterns
Where are immigrants moving from and where are they settling? Why?
In what kinds of conditions do most immigrants find themselves?
Immigrant
population growth
How fast or slow is the demographic change?
What countries do the recent immigrants come from?
Economic status
What education level and skill level do immigrants have?
What is the level of English proficiency in speaking, reading and writing?
What kinds of dwellings or living conditions do immigrants tend to live in the
neighborhood? Renters and homeowners often have different visions for
community development.
What is the family structure of most immigrants in the neighborhood?
Immigrant status
What is their legal status?
Are there other immigrant-serving organizations addressing citizenship needs?
Motivation
What are their reasons for immigrating?
Do immigrants feel culturally alienated in the community? Why or why not?
Do certain immigrant groups have strong cultural connections in the community that assist
them? If so, how can a CDO access and build on those existing connections?
October 2006
broadened their mission from serving one ethnic group
to reach a more diverse constituency. CDOs that have
broadened their missions rarely limit programs to people
in their service neighborhood, and have stretched limited
resources to areas where mainstream organizations have not
responded.
But traditional gateway cities are not the only places experiencing immigrant growth and diversity. Data from the
2000 census brings to light the dispersal of recent immigrants
to suburbs outside central metropolitan cities to Midwestern
counties and rural towns all over the country. Immigrants
are migrating or immigrating directly to these areas to be
with family members, and to take advantage of job oppor-
Local Needs Assessment
Box 3.1
tunities and affordable housing. The influx of immigrants
to rural areas, for example, has caused numerous challenges.
Often there are few community development organizations
to handle the growing numbers, and those present are illequipped to provide services to meet the critical housing
needs of migrant agricultural workers or immigrant factory
workers. These phenomena mean that community development practitioners in these areas must seek new methods of
outreach, education and partnership.
Given the heterogeneity of this immigrant wave, there
are no one-size-fits all solutions to engaging immigrants in
community development. Community development organizations working in dynamic neighborhoods with changing
demographics frequently wrestle with questions such as:
How do I know when immigrant communities are
moving into my neighborhood?
What are their community-development needs?
El Centro, Inc., conducted a survey of immigrant
adults in the metropolitan region of Kansas City,
Kansas. The CDO adopted an organizing strategy to
identify and define the social, economic, educational
and civic realities of Latino immigrants through a
comprehensive needs assessment. El Centro used
the study in its strategic planning process.
Chhaya Community Development Corporation, in
Queens, New York, conducted a quantitative and
qualitative needs assessment of the South Asian
American community using various data resources,
including decennial census data from the New York
City’s Housing and Vacancy Survey, and data from
a random survey and focus groups conducted by
Chhaya CDC staff. Using a grassroots approach
that included interviews in various languages, the
organization was able to capture information that
would not be revealed by quantitative data alone.
Neighborhood Housing Services of New York
City (NHS of NYC) has adopted various forms of
market analysis in order to understand its changing
constituency. In 2002, NHS of NYC hired a consulting
group, Checco Communications, to conduct a
series of focus groups throughout the region. The
information gathered helped the CDO develop
more culturally appropriate marketing messages
for immigrants. NHS of NYC was also involved in a
needs assessment with HUD and Hunter College to
understand the homebuying needs of Koreans and
Dominicans in northern Queens. This partnership
between the CDO, college and public agency was
a way to leverage meaningful information for all
parties involved.
October 2006
What role can my organization play in working with
recent immigrant groups?
Who else in the community is working on these
issues?
Where can my organization get the resources to
expand and strengthen our immigrant focused work?
These questions — along with countless others about
socioeconomic conditions, housing and economic-development opportunities, leadership development, and the availability of resources — can be answered through a firm understanding of the immigrant communities being served, their
organizational capacity, and other key stakeholders in the
immigrant community. Many of the CDOs targeting services
to newcomers have four common elements: (1) understanding of local demographic changes and immigrant needs in
the community, (2) organizational assessment of the capacity
to address the changes and needs, (3) knowledge of strategic
partners and a willingness to collaborate, and (4) innovative
programs and services tailored to community needs.
Understanding local demographic changes
Detailed market analysis is already a common practice
that well-managed CDOs engage in, but it is crucial for
CDOs that work in communities with changing demographics to consistently and constantly analyze local demographic
trends. Using data that is based on observation, research and
analysis rather than anecdotal information helps CDOs
identify and present the needs of their changing community.6 Although demographic analysis of data from sources such as the census and the American Housing Survey
helps, it is not the only means of understanding the local
immigrant population. Qualitative data collection through
grassroots methods like facilitated focus groups or doorknocking further illustrates the most pressing needs for invisible immigrant communities, many of whom might not
have been counted in the census or any other governmental
19
surveys because of their uncertain legal status.7 A thorough
and sound needs assessment can help an organization articulate and justify the need for action and change. It will also
help to create baseline statistics that will be important to
communicate to funders, board members and other stakeholders (See Box 3.1, Local Needs Assessment).
It is crucial for CDOs that work in
communities with changing demographics
to consistently and constantly analyze
local demographic trends.
Organizational assessment
Recognizing the community development characteristics
and needs of newcomers is only the first element of reaching out to the immigrant community. CDOs must also take
stock of their organizational capacity in order to determine
the staffing and resources needed to serve the community.
Once CDOs have a clear assessment of their changing
constituency and understand their organizational capacity
to serve the immigrant population, they can engage in some
form of strategic planning. Strategic planning allows CDOs to
think through the entire service-delivery process, recognizing
staff capacity. For example, in the Twin Cities of Minnesota,
the Community Neighborhood Housing Services found it
to be cost-efficient to train people within the immigrant
community about financial services and home ownership.
Once trained, the Homeownership Center hired immigrant
trainees as consultants and provided them with cell phones to
field questions and concerns from potential clients.8
Strategic partnerships
Developing strategic partnerships is a key element in
building organizational capacity to serve immigrant communities, and more importantly in creating a network of
organizations that provide continuous support. In many
cases, it does not make sense for a CDO to serve multiple
populations. Instead, the organization should foster partnerships or contracts with organizations that have a track record
of geographic or cultural understanding with immigrant
populations. Immigrant-focused and ethnic-specific organizations can help serve communities with specific language
or cultural barriers. Frequently, these community-based
organizations provide the first wave of social services and
short-term or emergency housing to newcomers. But they
often lack the capacity to get immigrant families into the
pipeline of the financial system, long-term housing, stable
jobs and homeownership opportunities. Some CDOs look
to connect their financial literacy and education programs
to English-language schools or citizenship classes at the local
20
community center. Other CDOs have linked up with local
schools because they found that many working immigrant
parents were only willing to take time out to participate in
programs related to their child’s success.
Another approach adopted by CDOs is to reach out to
trusted advisors and leaders in local immigrant communities
and organizations. Although board members and the leadership of CDOs are often members of the local community as
well, there is often a time lag from when the demographics
of a community are changing and when CDOs are able to
build immigrant leadership within the staff or organizational leadership. As the residential make-up of a neighborhood
changes, CDOs must respond by providing the training opportunities and outreach for immigrant residents to participate and develop their leadership.
Box 3.2
Partnerships between financial
institutions and CDOs
Increasingly, financial institutions are developing
partnerships with CDOs due to immigrants’ potential
market power. More CDOs are endorsing financial
education and training for immigrant and minority
communities. As a result, there are several resources for
language-specific information on financial education.
One such effort is the Money Smart program of the
Federal Deposit Insurance Corporation (FDIC). The
curriculum is offered in Spanish, Chinese, Vietnamese
and Korean. The tailored language versions of Money
Smart were developed to help build awareness among
unbanked immigrants. Also, the National Coalition
for Asian Pacific American Community Development
(National CAPACD) offers free financial education
materials online in English, Chinese, Korean and
Vietnamese.1 Motivated financial institutions, such as
Wells Fargo and First National Bank and Trust of Rogers,
Arkansas, are becoming more aware of the power of
reaching and capturing the eligible immigrant market
for housing opportunities. A handbook developed by the
Fannie Mae Foundation and Georgetown University’s
Institute for the Study of International Migration
presents various ways that financial institutions can
access immigrant communities. One possibility includes
partnering with community based organizations to
provide needed financial-literacy training. The handbook
describes ways that banks can use organizations like
CDOs as a conduit.2
October 2006
For established organizations, such as the Unity Council in Oakland, California, it did not make
sense to duplicate services that were already being offered by other CDOs in the area.
Motivation: Recognizing that their community’s largest population, Latinos, dropped below 50 percent of the
area population, the leadership decided to broaden the organizational mission to include a more diverse
constituency that also works with underserved Asian Pacific Americans (APAs).
Strategy: The Unity Council’s former executive director and founding member, Arabella Martinez, understood
that her staff could not tackle the issues facing Southeast Asian families alone. The organization sought out partnership with other CDOs in the region with knowledge of, access to and expertise on the APA community.
Outcome: Unity Council’s job-readiness and employment program involves an extensive partnership between
five community-based organizations and is available in seven languages.
Tailored programs
Given the increasing diversity and complexity of immigrant communities today, CDOs need to develop innovative outreach and appropriate delivery strategies — and must
also think ahead. Some of the issues facing underserved immigrants are similar to those of the low-income population
as a whole, but there are specific socio-cultural barriers that
make it even more challenging for new immigrants to better
their circumstances. Language access, employment opportunities and cultural attitudes about financial institutions are
some of the barriers that make it difficult for immigrants
to engage in community development opportunities. In
some areas, the influx of new immigrants is so fast that there
simply are not enough institutions to address the changing
needs of the community. Immigrants have so many different needs that even cities with constant flows of immigrants
have a relatively weak immigrant support infrastructure.
Given the increasing diversity and
complexity of immigrant communities
today, CDOs need to develop innovative
outreach and appropriate delivery
strategies — and must also think ahead.
Outreach strategies: Offering bilingual services and translated materials are not enough, especially given the increasing diversity of today’s immigrants. Outreach and marketing
strategies to immigrant communities must be innovative,
recognizing their education level, cultural values and priorities. CDOs must update traditional outreach methods by
using ethnic print media and local radio stations to inform
immigrant communities about their services. Increasingly,
CDOs must do more footwork and outreach to churches,
trade associations and mutual assistance associations to gain
access to immigrant communities. CDOs that work with
October 2006
newcomers often have strong education and training components that are accessible to working immigrants and provide culturally appropriate one-on-one counseling that meets
the language needs and cultural norms of that community.
For example, in order to decrease the homeownership gap
of the growing Latino population, the National Council of
La Raza supports increased employment of Latino bilingual
and bicultural professionals in the financial services industry
through training and internship programs. Neighborhood
Housing Services of New York City conducts public-opinion research to identify appropriate media messages and
themes that encourage qualified immigrant families to seek
homeownership opportunities; then it markets its materials
through ethnic radio, print, and television outlets.
Community-building: CDOs dealing with neighborhood
tensions fueled by anti-immigrant sentiment and discrimination should focus on common goals and issues. Community-building activities must openly address the anxiety that
arises between existing communities and newcomers. CDOs
often wrestle with questions about how to mediate tensions
between existing communities and newcomers. Lori Gay,
President and CEO of Los Angeles Neighborhood Housing Services, says this issue is not new, but is increasingly
important to deal with.9 She asserts that all members of the
community should focus on common issues, like decent
and affordable housing or living-wage jobs. Sometimes it
is a matter of dispelling misconceptions that are rooted in
the negative stereotypes of immigrants. Tensions around job
competition and limited resources continue to arise between
those who consider themselves “Americans” and those who
are labeled as “foreigners.” For many existing residents, there
is an honest concern that increased job competition with lowskilled workers reduces the earnings and job opportunities
of low-skilled or disadvantaged native workers. But no conclusive evidence exists that immigrants displace natives from
jobs or reduce earnings of the average worker.10
Challenges of a growing immigrant population have
been prominent in California in the past decade. CDOs
21
and community leaders in historically African American
communities, like South Central Los Angeles, struggle with
the fact that the majority of the population is now Latino.
Community development leaders must possess a multiracial and multiethnic perspective that fully appreciates each
group’s needs while successfully advocating for multigroup
goals that produce a greater good for everyone. CDOs must
communicate and work with other organizations for the
common good, to foster community goodwill, and to build
infrastructure and programs that will improve everyone’s
standard of living and generate neighborhood vitality. Leaders of CDOs must negotiate how best to bring groups that
are in conflict together as well as to mitigate disputes over
competition for limited resources.
Private sector attention: Due to issues of immigration
status, income sources and creditworthiness, many immigrants are ineligible for certain financial services and programs. As lenders attach increasing importance to formal
credit histories, the challenges for potential borrowers
living outside the economic mainstream are intensifying.
The increasing use of conventional tools to measure creditworthiness means that many immigrants are deemed ineligible for financing when their conventional assets and
income are handled by computerized screening. Many immigrants cannot demonstrate conventional credit histories.
By custom, many immigrants prefer not to use credit cards;
while they may pay rent, their names might not be on the
lease; multiple generations live in the same home or apartment; and often their work is paid for in cash and there is no
written documentation of their employment on the books.
However, lending institutions are providing more innovative financial products that take into account the
challenges of immigrants regarding eligibility, citizenship
status, income sources and creditworthiness. Banks, mortgage institutions and real estate brokers are increasingly
aware that immigrant homebuyers make up a market of borrowers largely unfamiliar with and often skeptical of financial institutions. Lending professionals can aid immigrants’
entry into and completion of the homebuying process by
advertising in their native languages, employing staff who
speak those languages, and educating staff about relevant
issues and barriers for specific immigrant populations. Community development organizations need to tap into this
growing attention to immigrant markets and help to expand
and inform private practices. CDOs can focus on financial
fitness in order to get low-income immigrant families into
the economic pipeline (See Box 3.2, Partnerships between
financial institutions and CDOs).
In addition to the linguistic, cultural and institutional
barriers that face many immigrant communities, there are
various challenges that CDOs face when looking to increase
their strategies to meet immigrant needs. With dwindling
government support for operating expenses, many CDOs
are unable to build their capacity to meet the needs of their
changing populations. The lack of resources and support is
also a result of the constraints imposed by funders, even
if the CDOs are committed to carrying out their mission
of being resident driven. National intermediaries, such as
NeighborWorks America, Enterprise Community Partners,
and the Local Initiatives Support Corporation (LISC), are
beginning to respond to the growth of the immigrant population by providing CDOs with financial training and support. Some banks at the national level have broad goals, but
allow their local entities to determine the market needs and
In order to address the growing need for housing services for the Latino population in Arizona,
the National Council for La Raza’s Homeownership Network (NHN) brought a coalition of
Latino CDOs together to increase outreach, specialized products, and services. The coalition
includes Housing for Mesa, Chicanos Por La Causa, Housing America Corporation and the
National Council for La Raza.
Motivation: To break Latinos’ language and cultural barriers to the homebuying process.
Strategy: Target low- to moderate income Latino families that are potential homebuyers with the following programs:
Flexible underwriting through a partnership with Fannie Mae to create more flexible standards with Nattional
Council of La Raza (NCLR). Innovations included substitution of nontraditional evidence of creditworthiness, such as regular payments of rent and utility bills for families with little or no credit history, and greater
acceptance of multiple sources of income to calculate mortgage eligibility.
Down-payment assistance provided as small grants through the use of public and private resources.
Mandatory prepurchase housing counseling by Latino CDOs with support from Fannie Mae and First Interstate and with extensive technical assistance from NCLR.
22
October 2006
entry points. In order to expand and tailor services to immigrants, organizations need financial and technical resources
to access data and market analyses, as well as regional and
national networks to share successful service delivery and
inclusion strategies.
Conclusion
Immigration today is different from the past and is
driving much of the dynamic change in neighborhoods.
CDO’s should play a key role in addressing the housing,
economic and civic-engagement needs of new immigrants
in the neighborhoods they serve. CDO’s are often the first
to know about local housing concerns for new residents.
They are positioned to identify trends and needs in immigrant communities, and possess the creativity and flexibility to calibrate the support to effectively match that need.
The growing immigrant population demands the attention
of the community development field at all levels. But the
goal of public agencies cannot reasonably be to advocate for
the development of distinct housing and economic development projects for every ethnicity or immigrant subgroup.
Rather, local agencies should remain sensitive to the general
importance of culture, understand its relationship to racial
discrimination and intolerance, and work toward establishing an inventory of strategies appropriate for many ethnic
groups and contexts. CDOs should primarily look to develop strategic partnerships to educate and counsel immigrants about the U.S. financial sector. CDOs should also
work with lenders, real estate agents and banks to establish
programs appropriate for low-income immigrants.
CDOs can be key players in economically uplifting immigrant communities, but they need to gather more data
and engage in more analysis of their markets. Staff should
know what demographic variables to look for and analyze. It
is important to talk to key informants, including immigrant
leaders, social-service advocates and regional coalitions.
Strategies must target the needs and assets of immigrants.
In order to do so, CDOs should assess their organizational
capacity and should develop a plan before retooling strategies for outreach and programs. Strategic partnerships are
important in the entire process.
Finally, the homeownership focus of community development is important, but is not the only key to an effective
community development strategy. CDO’s should extend
their homeownership goals to recognize the realistic barriers facing the growing immigrant population. In many tight
housing markets, the low-income status of immigrants, coupled with the lack of available and affordable housing, make
“the American Dream” very difficult to achieve. CDOs
should support immigrant advocacy issues with an emphasis
on multiple housing goals that address both rental and homeowner needs, as well as economic development strategies
that deal with the economic gap. Dealing with unemployment, building day-care centers and promoting neighborhood commercial areas are all ways to ensure that housing
efforts will not be undermined by other developments.11 By
increasing immigrant community awareness, knowledge, engagement and commitment, CDOs can convey the urgency,
possibility, equity and inevitability of change in cities across
the United States.
In Santa Fe, New Mexico, Homewise (formerly Neighborhood Housing Services of Santa Fe)
has created a Spanish speaking Immigrant Program to help immigrants overcome their limited
English skills and understand the complicated rules of the mortgage industry.
Motivation: Many immigrants do not believe that home ownership is a realistic goal, and think that their only option
is to purchase a manufactured home using higher-interest financing. Non-English speakers are one of the most targeted populations for predatory lending practices, and many experience high levels of housing discrimination.
Strategy: Education about the financial process and setting realistic expectations that the process will take time.
To deal with the issues of eligibility, Homewise developed a one-hour orientation called Mortgage Eligibility
for Immigrants that focuses on criteria for low-income, Spanish-speaking immigrants. Some sessions are held
in collaboration with local immigrant led CBOs, like Somos Un Pueblo Unido. The collaboration helps create
an environment of trust and legitimacy between immigrant customers and Homewise. Once deemed eligible,
participants fill out a customer profile and meet with a Spanish-speaking loan counselor for one-on-one services.
Outcome: In a few years, Homewise was able to assist 12 immigrant families into homeownership, and 24 are
close to being mortgage- ready. About 75 Spanish-speaking families now receive financial counseling. And
Spanish-speaking staff has increased to four.
October 2006
23
Community Profile: Utah
Comunidades Unidas
T
hough not typically thought of as an immigrant
gateway, between 1990 and 2000 the foreignborn population Utah increased 171 percent,
with the majority of that increase composed of
immigrants from Latin America. Drawn by employment
opportunities in the construction, tourism, farming and
mining industries, as well as by affiliations to the Church
of Jesus Christ of Latter-day Saints, the presence of immigrants from Mexico and Central and South America
has grown in urban and rural communities throughout
Utah.
This demographic shift is pushing state agencies,
nonprofits, and private-sector firms to understand and
reach out to Hispanic community members in new ways.
Within Utah’s Department of Community and Culture,
a unified state Office of Ethnic Affairs was created in
2005 from previously fractured ethnic office ‘silos’ to
ensure that the state government was responding more
efficiently to the needs of Utah’s growing ethnic communities. This office conducts public policy analysis and
research on different issues affecting Utah’s ethnic communities, and it consults with state agencies to ensure
that ethnic populations have access to state programs
and services.
“One of the most pressing issues facing Utah’s Hispanic community is the need for improvements in health
care and health behaviors,” said Luz Robles, the director of the Office of Ethnic Affairs. Results from a 2002
Survey by the Utah Department of Health showed a host
of health disparities between Utah’s Hispanic population
and the population at-large, and reported that nearly 25
percent of Utah’s Hispanic adults indicated being in fair
or poor health compared to 10 percent of all Utahns.
For recent immigrants, risks for poor health outcomes
are compounded for a number of reasons, including linguistic, cultural and geographic isolation, low incomes, a
lack of insurance, and low education levels.
Chief among the programs in place to help address
health disparities in the Hispanic population is the Comunidades Unidas program. Established in 2002, Comunidades Unidas is a growing nonprofit health education
program that operates throughout Utah to help ensure
that community health resources are accessible as well as
culturally and linguistically appropriate. Comunidades
24
Unidas uses a peer-to-peer model of community outreach, enlisting members of the Hispanic community
to volunteer as peer educators. Literally going door to
door in some areas, educators are able to inform community members in Spanish on a host of health issues
ranging from HIV/AIDS prevention to prenatal care to
diabetes management. When necessary, educators help
connect people to health services. In addition, educators
train health-care providers to recognize a number of cultural issues so that they can better treat their patients.
“Taboos within Latino cultures mean that patients don’t
share information that in other communities would be
common sense,” said Sabrina Morales, executive director of Comunidades Unidas. “And cultural beliefs and
practices—like the ‘evil eye’ and the use of curanderos (folk
healers), which sometimes leads people to believe they
are immune to certain diseases—are typically overlooked
by health care providers.”
Comunidades Unidas conducts community forums to
help identify high-priority health issues in the communities it serves. In many areas, adult dental care has emerged
as the top issue, and in more isolated and remote places,
mental health and domestic violence rank high on the
list of issues to address. Morales noted that by learning
from community members what their needs are and then
transmitting that information to service providers, Communidades Unidas helps achieve a higher level of cultural competency in program and service provision. For
example, in places like Moab and St. George, where work
is seasonal, many families are reliant on food banks in
the off-season. But because food banks were not stocking
familiar foods such as tortillas, family diet and nutrition
were compromised. Outreach workers succeeded in working with the food bank to stock more appropriate foods.
Comunidades Unidas employs a multifaceted approach to engaging the community in lowering the barriers to health care access for Utah’s Hispanic families. Its
newest program is a multicultural youth coalition that
trains teens on advocacy and leadership skills, and many
of the program participants have spoken in front of their
legislators on health and education-related issues. “A lot
of the people who are making a difference are coming
from within our communities,” said Morales, “and we are
working to empower them.”
October 2006
Endnotes
Crossing Borders, Creating Communities
1
Bureau of Labor Statistics (2006). “Foreign-born Workers: Labor
Force Characteristics in 2005,” Bureau of Labor Statistics News,
April 14, 2006.
2
Naturalization increases with length inside the U.S. More than 80
percent of foreign-born who arrived before 1970 have become
citizens; today, 40 percent of the foreign born living in the U.S. are
naturalized. U.S. Census Bureau data.
3
The foreign-born population includes legal immigrants who come
here on permanent and temporary visas for work, study, and
family reunification, naturalized citizens, as well as undocumented
immigrants.
4
Office of Immigration Statistics, Department of Homeland Security
(2006). Estimates of the Unauthorized Immigrant Population
Residing in the United States: January 2005; Jeffrey S. Passel,
Randy Capps, and Michael Fix (2004). Undocumented Immigrants:
Facts and Figures. The Urban Institute: Washington, D.C.. (Estimates
that 9.3 million undocumented in 2002, with an annual growth rate
of about 500,000.); Jeffrey S. Passel, The Size and Characteristics
of the Unauthorized Migrant Population in the U.S.: Estimates
Based on the March 2005 Current Population Survey. Pew
Hispanic Center: Washington, DC, March 7, 2006, p. 11. (Analysis of
the March 2005 Current Population Survey shows that there were
11.1 million unauthorized migrants in the United States a year ago.
Based on analysis of other data sources that offer indications of the
pace of growth in the foreign-born population, the Center developed
an estimate of 11.5 to 12 million for the unauthorized population as
of March 2006.)
5
Schmidley, A. Dianne, U.S. Census Bureau, Current Population
Reports, Series P23-206, Profile of the Foreign-Born Population
in the United States: 2000, U.S. Government Printing Office,
Washington, DC, 2001.
6
Singer, Audrey (2004). The Rise of New Immigrant Gateways.
The Brookings Institution Center on Urban and Metropolitan Policy:
Washington, D.C.
7
Fernandez, Catherine (2003). Community Development in
Dynamic Neighborhoods: Synchronizing Services and Strategies
with Immigrant Communities, Neighborhood Reinvestment
Corporation and the Joint Center for Housing Studies.
8
Singer, Audrey (2004). The Rise of New Immigrant Gateways.
The Brookings Institution Center on Urban and Metropolitan Policy:
Washington, D.C.
9
Capps, Randy and Jeffrey S. Passel (2003). The New Neighbors:
A Users’ Guide to Data on Immigrants in U.S. Communities. The
Urban Institute: Washington, D.C.
10 DeNavas-Walt, Carmen, Bernadette D. Proctor, and Cheryl Hill Lee,
U.S. Census Bureau, Current Population Reports, P60-231, Income,
Poverty, and Health Insurance Coverage in the United States:
2005, U.S. Government Printing Office, Washington, DC, 2006.
another influential survey of the literature, economists Rachel
Friedberg and Jennifer Hunt concluded that a 10 percent increase
in the immigrant population entails at most a 1 percent decrease
in wages, and no evidence of economically significant reductions
in native employment See Rachel M. Friedberg and Jennifer
Hunt (1995). “The Impact of Immigrants on Host Country Wages,
Employment and Growth,” Journal of Economic Perspectives 9(2):
23-44.
13 Borjas, George J. 1999. Heaven’s Door. Princeton University Press:
Princeton, NJ.
14 Borjas, George J. 2003. “The Labor Demand Curve Is Downward
Sloping: Reexamining the Impact of Immigration on the Labor
Market.” The Quarterly Journal of Economics, Nov. 1335-1374.
15 McCarthy, Kevin F. and Georges Vernez. 1998. Immigration in a
Changing Economy: California’s Experience—Questions and
Answers. RAND: Santa Monica.
16 For example, David Card, “Immigrant Inflows, Native Outflows, and
the Local Labor Market Impacts of Higher Immigration,” Journal
of Labor Economics 19, 2001, p. 22-64; David Card, “Is the New
Immigration Really So Bad?” NBER Working Paper No. 11547.
17 Card, David (1990). “The Impact of the Mariel Boatlift on the Miami
Labor Market,” Industrial and Labor Relations Review. 43: 245-257.
18 This annual salary translates into an hourly wage of approximately
$10.90, less than the housing wage for all but 9 states (Wyoming,
South Dakota, Oklahoma, Kentucky, Mississippi, Alabama, North
Dakota, Arkansas, and West Virginia). Danilo Pelletiere, Keith
Wardrip, and Sheila Crowley (2005). Out of Reach 2005. National
Low Income Housing Coalition: Washington, D.C.
19 Bolin, Tim (2006). “The Economic and Fiscal Impacts of Immigration,”
Institute of Industrial Relations Paper 0001. University of California,
Berkeley.
20 Economic Report of the President 2005, U.S. Government Printing
Office: Washington, D.C.
21 To provide just one example, nearly 33 percent of low-income native
citizens used Medicaid in 2001, compared with only 13.2 percent of
low-income noncitizens. Use of public benefits by legal immigrant
families with children who earn less than 200 percent of the federal
poverty level fell sharply after the implementation of the 1996
welfare reform act. See Michael Fix and Jeffrey Passel, The Scope
and Impact of Welfare Reform’s Immigrant Provisions, Urban
Institute: Washington, D.C., January 2002; John Holahan and Marie
Wang, The Decline in Medicaid Use by Noncitizens since Welfare
Reform, Urban Institute: Washington, D.C., May 2003.
22 Bolin, Tim (2006). “The Economic and Fiscal Impacts of Immigration,”
Institute of Industrial Relations Paper 0001. University of California,
Berkeley.
23 Smith, James P. and Barry Edmonston, eds. (1997). The New
Americans: Economic, Demographic, and Fiscal Effects of
Immigration. The National Academy Press: Washington, D.C.
11 Pew Hispanic Center (2006), “The State of American Public Opinion
on Immigration in Spring 2006: A Review of Major Surveys.” Pew
Hispanic Center: Washington, D.C.
24 Holzer, Harry J. (2006). Does Immigration Help or Hurt LessEducated Americans? Testimony before the U.S. Senate Judiciary
Committee, April 25, 2006.
12 Smith, James P. and Barry Edmonston, eds. (1997). The New
Americans: Economic, Demographic, and Fiscal Effects of
Immigration. The National Academy Press: Washington, D.C. In
25 Singer, Audrey (2004). The Rise of New Immigrant Gateways.
The Brookings Institution Center on Urban and Metropolitan Policy:
Washington, D.C.
October 2006
25
Financial Access for Immigrants
1
This article is adapted from Financial Access for Immigrants:
Lessons from Diverse Perspectives, by Anna Paulson, Audrey
Singer, Robin Newberger and Jeremy Smith, published by the
Federal Reserve Bank of Chicago and The Brookings Institution,
May 2006, available at http://www.brookings.edu/metro/
pubs/20060504_financialaccess.pdf
2
Suro, Roberto, Sergio Bendixen, B. Lindsay Lowell, and Dulce C.
Benavides, “Billions in Motion: Latino Immigrants, Remittances and
Banking,” The Pew Hispanic Center and The Multilateral Investment
Fund, November 2002, available at www.iadb.org/mif/v2/files/
PewHispanicCenter.pdf.
3
Meyers, Deborah, “Migrant Remittances to Latin America: Reviewing
the Literature,” Inter-American Dialogue and The Tomás Rivera Policy
Institute, May 1998, available at www.iadialog.org/publications/
meyers.html.
4
5
6
Hilgert, Marianne A., Jeanne M. Hogarth, Sibyl Howell, Edwin
J. Lucio, Juan Sanchez, Wayne Smith, Elizabeth McQuerry, Ana
Cruz Taura, and Jessica LeVeen Farr, “Banking on Remittances:
Increasing Market Efficiencies for Consumers and Financial
Institutions,” paper prepared for April 15, 2005 Federal Reserve
System Community Affairs Research Conference, available at www.
chicagofed.org/cedric/files/2005_conf_paper_session3_hogarth.pdf.
Suro, Roberto, Sergio Bendixen, B. Lindsay Lowell, and Dulce C.
Benavides, “Billions in Motion: Latino Immigrants, Remittances and
Banking,” The Pew Hispanic Center and The Multilateral Investment
Fund, November 2002, available at www.iadb.org/mif/v2/files/
PewHispanicCenter.pdf.
Moser, Lauren, and Esther Park, “Best Practices in Immigrant
Lending,” prepared for the American Bankers Association, Shorebank
Advisory Services, May 25, 2004, available at /www.aba.com/NR/
rdonlyres/1FAE5B14-C034-4FF7-8566-9664F0BDEDEC/35994/
ImmigrantMarketLendingPaperMay2004.pdf.
7
Ibid.
8
The ITIN is a nine-digit tax processing number issued by the Internal
Revenue Service (IRS) to individuals who do not qualify for a Social
Security number but earn income in the United States.
9
Orozco, Manuel, “The Remittance Marketplace: Prices, Policy
and Financial Institutions,” Institute for the Study of International
Migration, Georgetown, June 2004, available at http://pewhispanic.
org/files/reports/28.pdf.
BOX 2.2
Sources: Bruno, Andorra, and K. Larry Storrs, Consular Identification
Cards: Domestic and Foreign Policy Implications, the Mexican Case,
and Related Legislation, Congressional Research Service Report for
Congress, The Library of Congress, March 31, 2005, available at www.fas.
org/sgp/crs/misc/RL32094.pdf.
Kuehl, Steven W., “Conference Series: An Informed Discussion of
Financial Access for Immigrants—Des Moines, Milwaukee, Detroit,
Indianapolis, Springfield, Lisle, and Appleton,” Profitwise News and
Views, Special Edition, Federal Reserve Bank of Chicago, August 2005,
available at www.chicagofed.org/community_development/files/pnv_
aug2005.pdf.
BOX 2.3
Source: Federal Reserve Website of financial services fee schedule:
www.frbservices.org/FeeSchedules/FedACH2005.html.
Community Development in Dynamic Neighborhoods
1
The full report, published by the Harvard Joint Center on Housing
Studies and the Neighborhood Reinvestment Corporation, is
available online at http://www.innovations.harvard.edu/showdoc.
html?id=5049
2
The terms “hot markets” and “soft markets” are defined by the
National Congress for Community Economic Development to
describe the different economic environments that CDOs work in.
3
Grogan, Paul S., and Tony Proscio (2000). Comeback Cities: A
Blueprint for Urban Neighborhood Revival. Colorado: Westview
Press.
4
Grogan and Proscio 2000, p. 5.
5
Interview with Kenneth D. Wade, chief executive officer,
NeighborWorks America, June 2003.
6
Collins, Michael, and Nancy McArdle (2003). “Getting a Grip
on Reality: Making the New 2000 Census Data Work for You.”
Workshop materials for Neighborhood Reinvestment Training
Institute. Washington, DC: Neighborhood Reinvestment Corporation.
p. 41.
7
Interview with Martina Guilfoil, Executive Director, Inglewood NHS,
July 2003.
8
Interview with Christi Baker, Chrysalis Consulting, July 2003.
9
Interview with Lori Gay, Executive Director, LA NHS, July 2003.
10 Remittance market draws major players: Banks, cards, credit
unions enter the fray, by Carolyn Said, Staff Writer, San Francisco
Chronicle, July 16, 2006.
10 Fix, Michael, and Jeffrey S. Passel (2002). “Assessing Welfare
Reform’s Immigrant Provisions.” In Welfare Reform: The Next Act,
Alan Weil and Kenneth Finegold, Eds. Washington, D.C.: Urban
Institute Press, pp. 179–203. Details at www.urban.org/pubs/
welfare_reform/index.html.
11 Current Population Survey, 2005 March Supplement.
11 Grogan and Proscio (2000), p. 72.
12 U.S. Department of Housing and Urban Development, Office of
Policy Development and Research. “The Importance of Demographic
Trends to Housing,” in U.S. Housing Market Conditions, May 2003.
BOX 3.2
13 ACORN website 7/20/06 http://www.acorn.org/index.
php?id=2082&L=1
1.
Interview with Lisa Hasegawa, Executive Director, National Coalition
for Asian Pacific American Community Development, August 2003.
2.
Schoenholtz, Andrew, and Kristin Stanton (2001). Reaching the
Immigrant Market: Creating Homeownership Opportunities for
New Americans. Handbook written for the Fannie Mae Foundation
and the Institute for the Study of International Migration at
Georgetown University.
14 Current Population Survey, 2005 March Supplement.
BOX 2.1
Source: Kuehl, Steven W., “Conference Series: An Informed Discussion
of Financial Access for Immigrants—Des Moines, Milwaukee, Detroit,
Indianapolis, Springfield, Lisle, and Appleton,” Profitwise News and Views,
Special Edition, Federal Reserve Bank of Chicago, August 2005, available
at www.chicagofed.org/community_development/files/pnv_aug2005.pdf.
26
Community Profile: Arizona
1
See, for example, the work on this subject by the Federal Reserve
Bank of Minneapolis: www.minneapolisfed.org/research/studies/
earlychild/
October 2006
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